Shareable Goods
Description
Alain Toner [1]:
“non-rival properties are intuitively obvious, meaning that you and I can use the same data without causing each other any inconvenience- everyone can benefit from it. Wireless, processing cycles and storage space posed a problem to this model, as these are resources which are finite, but which can be shared, because we are sold access to them in quantities exceeding our own requirements (leaving a surplus). They can they thus be considered as shareable goods.”
Yochai Benkler:
“Personal computers, wireless transceivers, and Internet connections are “shareable goods.” The basic intuition behind the concept of shareable goods is simple. There are goods that are “lumpy”: given a state of technology, they can only be produced in certain discrete bundles that offer discontinuous amounts of functionality or capacity. In order to have any ability to run a computation, for example, a consumer must buy a computer processor. These, in turn, only come in discrete units with a certain speed or capacity. One could easily imagine a world where computers are very large and their owners sell computation capacity to consumers “on demand,” whenever they needed to run an application. That is basically the way the mainframe world of the 1960s and 1970s worked. However, the economics of microchip fabrication and of network connections over the past thirty years, followed by storage technology, have changed that. For most functions that users need, the price-performance trade-off favors stand-alone, general-purpose personal computers, owned by individuals and capable of running locally most applications users want, over remote facilities capable of selling on-demand computation and storage. So computation and storage today come in discrete, lumpy units. You can decide to buy a faster or slower chip, or a larger or smaller hard drive, but once you buy them, you have the capacity of these machines at your disposal, whether you need it or not.” (The Wealth of Networks, p.113)
J. Hofmoki:
"In the preceding analysis, I concentrated primarily on the largely positive effects derived from interactions between the increased number of consumers of Internet goods. In turn, the shareable goods concept, introduced by Y. Benkler, refers to intrinsic characteristics of some private goods (computers, wireless transceivers, Internet connections) which facilitate sharing with other users (Benkler, 2004). The key argument behind this concept is that some goods available on the market are ‘lumpy’; i.e., they are produced in discrete sizes and represent varying capacities.
Typically, available capacity is fully utilized only in specific time intervals; otherwise, it remains partially underused. Such idle capacity of some Internet goods can be shared with other users at practically no additional cost to the owner. Notable examples of capacity sharing are distributed computing projects and peer-to-peer networks.
It should be noted that the issue of available excess capacity is not restricted to Internet goods, but common in other sectors as well. The difference is that, in the former case, sharing is much easier and more efficient. To share excess storage capacity in a warehouse located on the company premises would call for a set of additional logistic arrangements (controlled access to the warehouse, separate storage space, sharing additional costs of monitoring and insurance, etc.). Such problems are practically non-existent when sharing excess computer processing capacity via the Internet network.
Definitely, certain attributes of Internet goods make them more suitable for sharing than other goods. However, the simplicity, cost-efficiency and functionality of sharing are dependent upon the Internet network facilitating the whole process. The shareable goods theory can be extended easily to include the increased shareability of certain other private goods, once sharing is accomplished via the Internet. Here, I shall refer to the role of information and communication technologies as enablers of innovation processes, spread across various industrial sectors. Clearly, there are numerous examples of increased share-ability as a result of Internet connectivity, just to mention carpool (especially for long distance travel) and apartment-sharing systems. On the other hand, the simplified, practically cost-free sharing opportunities that exist on the Internet may provide additional powerful stimuli to accelerate the production of specific goods, as profoundly demonstrated by the most recent success of the YouTube exchange of short amateur movies." (http://dlc.dlib.indiana.edu/archive/00003831/00/Hofmokl_213801.pdf)
Discussion
Goods are thereafter divided in three on an arc from from lumpy (major capital investment required) to granular (billing on a consumption basis possible), and in the middle lie the medium grained goods such as computers, bandwidth etc.
Business models and consumer purchase capacity conspire to create a situation where:
“…a large number of individuals buy and use such medium-grained lumpy goods, that society will have a large amount of excess capacity “out there,” in the hands of individuals. Because these machines are put into service to serve the needs of individuals, their excess capacity is available for these individuals to use as they wish–for their own uses, to sell to others, or to share with others.” (ibid. )
But this does not mean that they will be shared: what are the alternative options open to users to do with their excess capacity? Let’s consider for a moment the large number of people owning second houses that they do not use most of the time - do they open the doors to the homeless? No, they rent them out, and if they succeed in extracting revenue only for the summer months of the year and they are vacant otherwise, so be it. Likewise with regard to underused motor vehicles, and it’s no accident that there is now an emerging commercial market in car-pooling, rather than it being the product of a self-organizing non-monetized process. Maybe Fon is somewhere in between.
But returning to Benkler:
“… the sharing of these material resources, like the sharing of human creativity, insight, and attention, nonetheless relies on both the comparative transaction costs of markets and social relations and the diversity of human motivation.” (ibid, p.115)
So this is directly linked to the ease/difficulty of sharing, and the scale of the returns available through monetization measured against the transactional labour to achieve them. ideally then, potential monetaryreturns would be low if processed through the market, and the surplus would be widely distributed so as to include enough people enticed by more social motivations:
“If excess capacity in a society is very widely distributed in small dollops, and for any given use of the excess capacity it is necessary to pool the excess capacity of thousands or even millions of individual users, the transaction-cost advantages of the sharing system become significant.” (ibid. p.115)
Notwithstanding this qualification there are other good reasons why social sharing could work, not least ints incredible potential as a media for the formation of community, something which economic gain will never help to attain, and of which we are all starved more every day.” (http://knowfuture.wordpress.com/2006/12/22/not-just-information-sharing-physical-resources/)
More Information
- Yochai Benkler: Sharing Nicely
- Collaborative Goods